We describe a new algorithm for 3-D electromagnetic inversion that uses glo
bal integral and local differential equations for both the forward and inve
rse problems. The coupled integral and differential equations are discretiz
ed by the finite element method and solved on a parallel computer using dom
ain decomposition. The structure of the algorithm allows efficient solution
of large 3-D inverse problems. Tests on both synthetic and field data show
that the algorithm converges reliably and efficiently and gives high-resol
ution conductivity images.